Mortgage Rates Drop
After experiencing a tremendous spike in 2022, mortgage rates have declined over the past few weeks. In fact, the average rate for a 30-year mortgage just hit 6.15% – the lowest that it has been in 18 weeks.
So if you’ve been contemplating buying a new home or property, this might be the time to swoop in before rates start to rise again.
Lower Prices and Fees
On top of lower interest rates, the average price of a home in the US has also been on a slow but steady decline since hitting a peak in May 2022, according to Redfin (RDFN).
That national average won’t be relevant for all markets. However, the fact that home prices are declining could be a sign that unsold houses are sitting on the market. If this is the case, even if prices on a whole have not declined in your market, it might be worth reaching out to owners of homes you are interested in to see if they’re open to negotiating a lower price.
Additionally, the Federal Housing Finance Agency just announced changes to its fee structure starting May 1, 2023, specifically to risk-based fees applied to housing loans. These changes could make property even more affordable for certain homebuyers. But for some, particularly those with lower credit scores or higher loan-to-value ratios, the fees may actually increase.
Time to Buy?
After the dramatic spike in mortgage rates during 2022, a drop of 1 to 2% might not seem like anything to celebrate. But when you’re borrowing hundreds of thousands, even a decline by less than a percentage point could save hundreds on your monthly mortgage payments.
With this in mind, you should also be sure to shop around with different lenders to ensure that you’re getting the lowest rate possible. Taking advantage of diminished rates will help you save some. Taking advantage of the wider market they signal could help you save more.
If you’re ready to look for a mortgage, view home loans from SoFi. Rates are competitive, and mortgage loan officers are there to answer questions.
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